Insider Chatter by Donna Bogatin

Spot Runner has acquired GlobeShooter videographers network, continuing to strengthen a portfolio for competing against Google. At the same time, however, Spot Runner is selling up a storm on behalf of arch rival Google.  

Is $200 billion market cap Internet juggernaut Google a direct competitor to startup Spot Runner, a Web-based television advertising production and media buying venture? I asked Nick Grouf, CEO, Spot Runner, just that almost one year ago. Grouf responded with a resounding “You got it.”

I chatted with Grouf on the heels of Google’s public acknowledgement that it is “running a small, early phase trial” of a cable TV ad delivery system last year. The Spot Runner claim to fame is: “the first Internet-based ad agency that makes it easy and affordable for local businesses to advertise on TV.”  Not surprisingly, SpotRunner did not welcome the Google television advertising initiative.

Grouf’s public reaction to the Google announcement of its entry into television advertising was to warn consumers of a nefarious Googleplex:

“Watching people watching TV,” is how Grouf characterized the prospective Google targeted TV advertising platform to me. Google will seek to leverage knowledge of viewership habits, Grouf believes, by using set-top box data collected without explicit consent of subscribers to “target ads according to the viewer.” Google’s end-game? Manipulate viewer data to sell ads at a higher price, Grouf indicated to me.

Interesting then that Grouf’s Spot Runner is now a proud seller of Google products, even as Spot Runner widens its sphere of operations with Google looming ever larger as the key competitor to beat. Spot Runner nevertheless has joined the ever growing ranks of would be Google killers that do their darndest to help Google’s core business grow ever unstoppable!

Spot Runner’s general ambitions are Googley indeed:

Revolutionize the way advertising is created, targeted, bought and sold, focusing on automating many of the more inefficient aspects of the advertising process and creating turnkey ways for busineses of all sizes to access creative and media planning and buying services.

Spot Runner even wants to help with buying Google services! Want a Search Ad with your TV ad?

Let the Spot Runner Search experts focus on the complexities of search advertising so you can focus on running your business.

In other words, let Spot Runner drive more business to Google AdWords! Why not, every one else wants to do it too! SEE: Yellow Pages Get Reprieve? The Myth of King Google Local Advertising ROI

MORE: Reach Local Advertising? How Google Squeezes SEMs and AdWords Buyers and
Local Ad Sales War: Why Google is a Guaranteed Winner and
Google AdWords Plus Box: Local CPC Bidding War Unleashed! and
Google Apps & Maps: Enterprise and Local Business STILL Missing and
Local Advertising Online: SMEs Hold the Billion Dollar Keys, ILM ANALYSIS and
Google Zeitgeist: $200 University Payola AdWords Scam and
How Google AdSense FAILS Better Business Bureau and
Frugal Google.org: How NOT To Save the World On $159,000 a Day

ALSO: Why Zynga, NOT Scrabulous, Has a Lucky Facebook Charm

CONTACT DONNA BOGATIN

I underscored Friday that Google’s mulit-billion dollar online AdWords machine is NOT inherently transferable to all media platforms, analyzing Google’s failure to sell radio advertising profitably. I also predicted that Google would pin its offline advertising hopes on television.

Google has confirmed my hypotheses today, in announcing its deal with Nielsen Company to add a “layer” of demographic data to set-top box activity tracked by Google: In heralding how a Nielsen product “improves Google’s measurement capabilities,” CEO Eric Schmidt acknowledges Google TV ads are NOT Google AdWords.

What’s more though, despite the new “enhanced by Nielsen” twist, Google TV ads remain a poor, distant cousin of their rich AdWords family.

Contrary to Google’s PR spin, and popular perception, an overlay of Nielsen data will not yield a seemingly magic “maximization of advertiser return” from Google TV ads.

The data that Nielsen will be giving Google is “representative television ratings panels.” In other words, extrapolations about national viewing habits created by using self-reported consumer usage information from a small sample of U.S. homes, out of the tens of millions of television viewing households.

Google is well aware of the persistent short-comings of its TV ads product. Mike Steib, product manager:

We want to help make TV advertising more effective and more relevant for advertisers…(BUT) When you talk about AdWords, there’s a person sitting there with a mouse and a computer that can go right to a Web site and give youi instant accountability. That doesn’t exist in television.

Nevertheless, the Google worldwide advertising domination fantasy is hard to repress: Google “expects” its TV ads to eventually boast the same type of “immediacy” as the Internet “backchannel.”

The Google offline advertising diversification track record does not support such a rosy forecast, however. 

Unfortunately for Google, a Googley long two years out of the Google-DMarc Broadcasting gate, Google has NOT succeeded in bringing its touted AdWords ”accountability” to “old-school” radio advertising. SEE: Radio Ads Stall: Google Pins Offline Advertising Hopes On TV

ALSO: Interop: Citrix XenSource Flys as Google Crashes and Google Confirms: Enterprise Apps is NO Microsoft Office Killer

CONTACT DONNA BOGATIN

No, Robert X. Cringely hasn’t “been asleep” while Nicholas Carr spins his “big switch” tales in preview of his next big book, waxing poetic about a sweet Apple and Google “rewiring of the world” in their images.

While Carr asserts he knows “precisely what the future of personal computing looks like,” Cringley undercuts Carr’s “simple” soliloquy on how and why Google and Apple are seemingly destined to change the world.

Cringley plays off of a quote of chief Googler Eric Schmidt to ’splain why Google and Apple are “strange bedfellows.”

I will play off of a quote by the same Google chief to explain why Google is also not destined to change the advertising world in its complete image.

In The Real Madison Ave: Before (and after) Google I discuss how, despite the current infatuation for all things Google SEARCH, Eric Schmidt and team will NOT be taking over Madison Avenue any time soon.

The Schmidt money quote, circa December 2006:

The long-term fantasy is we walk up to you and you give us, say $10 million and we’ll completely allocate it for you across different media and ad types.

The ad agency world was deemed to have been shaking in their boots at the time, Dave Morgan, Tacoda chairman, suggested, headlining “Agencies: Google has put a target on your back” and confirming, “there is clearly magic in Google’s business model.”

Three quarters later, however, the Googley financial magic continues to be 99% AdWords pure, and Tacoda is waving the AOL banner!

I have long underscored that Schimdt’s worldwide, online-offline advertising domination musings were indeed fantasy. WHY? Because despite Google’s oft stated claims, the AdWords “targeted, measurable” Google-centric, blind auction, advertisers bid-up-their-own-rates, multi-billion dollar money making self-serve Google machine is NOT inherently transferable to every single offline media platform.

NOW, Google itself is finally finessing its diversification tune and subtly acknowledging just how diffiicult it is to replicate the Google advertising magic offline.

Schmidt to Wall Street yesterday on how Google intends to keep GOOG fueled going forward:

We are working on expanding our breadth of ads offering with all sorts of new types of ads — gadget ads, video ads, others coming — and each of these initiatives gives advertisers new and interesting ways to build relationships with their customers.

So by building these deeper ad solutions, we really can deliver more value, especially in markets and industries where they’ve not really had these kinds of tools before. These are highly measurable and ROI driven campaigns and Sergey is going to talk a little bit more about this in terms of the steps we are taking in ads.

“Measurable” is the operative Google “value proposition,” the online competitive differentiator Mountain View was counting on to replicate its Web advertising domination offline.

Tim Armstrong, VP Ad Sales, on the rationale behind the Google buyout of dMarc Broadasting in January 2006:

Google is committed to exploring new ways to extend targeted, measurable advertising to other forms of media. We anticipate that this acquisition will bring new ad dollars and accountability to radio.

Despite Google’s “old college try,” however, almost two years later, Google has brought neither accountability NOR new ad dollars to radio.

Does Google “offer conversion tracking” for Audio Ads? Google asks and answers:

We don’t offer built-in tracking services for AudioAds.

Google nevertheless offers up handy ideas for markterers to do their own radio ad tracking, no matter who they buy their ads from! Unfortunately, for Google’s world ad domination ambitions, though, Google is only able to cite well-known, “old-school” proxy measures for direct ad tracking: Suvey customers, Provide coupons, Get a toll-free number…

The Google Audo Ads “value proposition” is so NON-COMPELLING, that the Googleplex has to give away radio advertising, big time, soliciting takers for its radio ad product by promising “sign-up and earn $2000 on your Google Audio Ads campaigns.” Coupled with its reimbursement of ad creation costs, Google is subsidizing advertiser radio ad “buys” to the tune of $2300.

Obviously, Google doesn’t like to talk about its radio advertising foray when it reports to Wall Street. Google is now pinning its diversification hopes on its TV ad trials:

The remarkable thing about television is, it’s surprising, but in fact of the offline advertising, it’s the one that’s closest to Internet level accountability and we feel we can bring much greater ROI type accountability to television advertising, much as we’ve done online…

I think TV ads could actually really be underappreciated in terms of our offline efforts. This is really one of the few places where you can bring the same type of Internet level accountability to offline advertising, so with search advertising, obviously our customers see real-time how their ads performed. The same thing is really true with the feedback mechanism that we get with set-top boxes. We are bringing the same level of granularity to the offline TV format.

Will Eric Schmidt soon ammend his media sales fantasy to read: The long-term fantasy is we walk up to you and you give us say $10 million and we’ll completely allocate it for you, online and on TV.

MORE: Microsoft Office Thunder to Blast Google Apps Cloud and Google Chokes with Postini: Billion Dollar Office Apps Giveaway

PLUS: Powerset vs. Google? NO! Amazon EC2 vs. the Googleplex and Click Forensics CEO: Click Fraud Hits 28% for Google AdSense, Yahoo Publisher Network

CONTACT DONNA BOGATIN

Mike Orren began the New Year at his Pegasus News blog by proudly declaring “we aren’t hyperlocal” and laying claim to a “panlocal” moniker instead. 

Orren even posted a New Year’s resolution for Pegasus, the online “local news and information service” he founded and leads: “In theory, panlocal should be a big business. We’ll be doing our damnedest to prove that in practice in the New Year.”

Orren did prove panlocal’s “big business” potential this year, to Fisher Communications; One week ago, the Seattle-based, NASDAQ traded, tradtional media company–owner/operator of 19 television stations and eight radio stations in the Pacific Northwest–announced it acquired Pegasus to “expand its online local news strategy.”

Why is Fisher embarking on a new online media trajectory? Why did Fisher choose Dallas-based Pegasus to help fuel its new local news focus?

I spoke today with Rob Dunlop, SVP Emerging Media, Fisher Communications, to find out.

Dunlop leads the Fisher Interactive Network, of which Pegasus News is currently the key component.

Collen Brown, Fisher CEO, announced the company’s online AND local intentions to shareholders earlier in the year:

Launching new Internet businesses, repositioning and realigning our company for success and growth in the new media world. As consumers and advertisers shift their behavior in this digitally driven enviornment, it is expected that we become more innovative, responsive and competively daring, to better serve our customers’ needs and drive our future as a local media company.

Dunlop told me that the panlocal focus of Pegasus supports Fisher’s goal of reaching the local consumer that typically wants a view of “the marketplace as a whole” and not simply information on “my neighborhood only.”

The hyperlocal, user-focused approach employed by Backfence is too narrow to drive sustainable community involvement and of limited appeal to local advertisers, Dunlop indicated.

The broader interest of the Pegasus local media model is multi-faceted, Dunlop told me:

1) User Generated Content friendly, but not just User Generated Content,

2) Aggregation of news from Professional Content Partners,

3) Original editorial contributions, wth a point of view,

4) “The Daily You” customization of content presentation for readers…

What is the Pegasus News “secret sauce” then? The pooling and personalized filtering of a myriad of local, national and world information data sources that speak to the affinities of individual users within a broader, more universal context, Dunlop indicated.

Does Fisher have a “secret sauce” to monetize the Pegasus local news strategy? I asked Dunlop just that. After all, in announcing the sale of his company to Fisher, Orren acknowledged Pegasus “ran out of cash” months ago.

Dunlop told me Fisher envisages a three-prong business model for the monetization of Pegasus:

1) Targeted, local merchant advertising leveraging the local media sales know-how and clientele of Fisher’s TV and radio stations,

2) Traditional database marketing leveraging Pegasus’ relationships with its registered users,

3) Licensing of the new Fisher-Pegasus panlocal Internet media model to offer prosepctive partners “speed to market” entry into the online local news business.

Orren welcomed Fisher by saying Pegasus looks forward to “reaching more cities, towns and neighborhoods over the coming year.”

Will Fisher’s home base of Seattle be the first Pegasus roll-out city? Not necesarily, Dunlop told me. For now, Dunlop plans on being a “commuter” to Pegasus’ home base, Dallas. What’s more, Fisher CEO Brown is a former Dallas resident.

Do all the Fisher Communications connections with Dallas mean a new Texas television or radio property is in the works for the heretofore Pacific Nortrhwest focused Fisher? I asked Dunlop if the Fisher geographical diversification via online local media would lead to future geographical expansion in its traditional media operations.

While not getting state specific, Dunlop concurred that geographic expansion via radio and/or tv properties would not be inconsistent with the Fisher 2006 Strategic Plan targeting a diversification of its “geographic and network portfolio.”

Dunlop did confirm to me that but one week out of the acquisition gate, Fisher is already fielding expressions of interest in the Pegasus local media model from prospective partners; In other words, the licensing component of the Fisher-Pegasus business model appears to be bearing prospective fruits.

ALSO: Backfence.com and Google: Money Can’t Buy Local Love and Local Matters: Backfence Farewell NO Real Back Story

CONTACT DONNA BOGATIN

News Corp. is on a video roll. MySpace TV is set to debut tomorrow and its premium video joint venture with NBC Universal is making a multi-million dollar upfront ad sales splash, according to the man integral to the JV sales charge: Kevin McGurn.

McGurn addressed “disruption” in the online video space this morning at the Advertising Research Foundation’s Audience Measurement 2.0 conference underway in New York City.

The NBC-Fox JV sold $2 million in advertising to ten charter advertisers, including General Motors and Cisco, within four hours upon the announcement of the venture in March, McGurn proudly underscored. What‘s more, online video ad sales for the JV in the current upfront market is “extremely favorable,” and the yet to be named and launched high-end video property is already “highly valued” and doing millions of dollars in business, he indicated.

McGurn believes it is incumbent upon networks to “focus on the content” because “the audiences will come along with it.” McGurn believes the NBC-Fox joint video entertainment venture is poised for success as “demand for high-end video inventory exceeds supply.” Professionally produced, episodic long form content is the focus of the NBC-Fox joint venture, McGurn said.

The NBC-Fox joint video venture is to formally launch its video destination site and distribution network in late summer in advance of the fall season. Extensive research is currently being conducted in order to gauge “users’ threshold for pain in advertising as a tradeoff for free content,” McGurn indicated.

All manner of video ads are being explored: “Takeovers, bottom-thirds, video during pre-roll for good exposure and then receding into some form of persistent background messaging…” In “experimenting,” advertising effectiveness and user acceptance are evaluated.

Thousands of hours of full-length TV programming, clips and movies, representing premium content from close to twenty networks and major television and film studios will be featured by the joint venture, according to News Corp. and NBC Universal. Distribution portal partners include AOL, Yahoo, MSN and MySpace.

CONTACT DONNA BOGATIN

Yahoo advertisers rule, not Yahooo ad products! So affirms Yahoo in announcing the merger of its search and advertising sales teams to take a “more holistic approach to advertising sales.”

Yahoo’s ”holistic” ad sales will be lead by a search guy, though; The display gal has been shown the door, to Martha Stewart’s company.

David Karnstedt moves from SVP of Yahoo’s Search sales business, to lead the new unified organization as Head of North American Sales. Wenda Millard, Yahoo’s former Chief Sales Officer in the US, leaves Yahoo because: ”While Wenda was a big contributor to our success in the past, the industry has shifted and requires a different set of skills to take the business forward.”

Yahoo underscores the importance of search in the overall ad sales scheme of things with ”Close the Loop: Understanding Search and Display Synergy,” a 2006 comScore study:

Online users who were exposed to both the search and display advertising campaigns increased their share of page views relative to competitive sites by 68 percent, and time spent by 66 percent. More importantly, among those exposed to both the search and display ads, purchases of an advertiser’s products and services increased by 244 percent online and 89 percent offline compared to online users with similar behavior who were not exposed to these ads.

Yahoo arch rival Google, until recently a pure search ad play, has long cried that not only does display advertising need search, alll advertising may be compromised if a search ad spend is not part of the campaign mix.

Google also is a fan of comScore, said to be collaborating in an effort to track the number of people exposed to display ads who later perform searches about the product.

The Google end-game is to continually increase monetization of Google.com by convincing marketers that a Google AdWords spend is essential for enhancing the effectiveness of a brand campaign’s entire advertising and marketing spend, online or off.

In other Googley words: No marketing campaign works without a (big) Google AdWords component.

Advertise online? Browsers will search for you at Google,.com

Advertise in print? Readers will search for you at Google.com.
Advertise on radio? Listeners will search for you at Google.com.
Advertise on TV? Viewers will search for you at Google.com.

Dare not buy Google AdWords? Browsers, readers, listeners and viewers will search for you at Google.com, but click on your competitors’ Google AdWords!

Yahoo is now touting a 360 degree display and search ad sales approach. With a search guy at the helm, though, search may soon rule, as it always has at Google.

ALSO: Google Human Powered Search: Who Needs Mahalo? and LinkedIn vs.Facebook: NO Business Contest

CONTACT DONNA BOGATIN